Editor’s note: NerdWallet’s Step by Step series gives small-business owners a behind-the-scenes look at the loan application process for various online lenders. We show you what to expect screen by screen as we go through the application process.
Table of contents
Dealstruck loan application summary
Prequalification
Account creation
Verification
Underwriting interview
Funding
Apply to Dealstruck
You don’t have to go to the bank anymore to get a small-business loan. Dozens of online lenders now offer small-business loans online. When you can’t qualify for a bank loan, try to avoid the very high interest rates that typically come with a cash advance. A middle-of-the-road option such as online lender Dealstruck can be a good alternative. For more details, read our Dealstruck review.
Dealstruck loan application: Summary
- Time: 2 days to 2 weeks
- Phone calls to expect: 3 to 4
- Documents needed: 2 years of business tax returns, interim financial statements, aging reports (if you have accounts receivable), bank statements
| Term loan | Asset-based line of credit | Inventory line of credit | |
|---|---|---|---|
| Cost of funding | 11% to 28% APR | 11% to 22% APR + prime rate | 11% to 22% APR + prime rate |
| Loan amount | $50,000 to $250,000 | Draw up to 85% of your outstanding invoices up to $500,000 | Finance 100% of your inventory purchases up to $500,000 |
| Term of loan | 6 months to 4 years | 6 months per draw | 6 months per draw |
| Qualifications | In business 1 year; 600+ credit score; $12,500/mo. revenue | Accounts receivable + term loan qualifications (at left) | Inventory purchase order + term loan qualifications (at left) |
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Dealstruck loan application: Step by step
Dealstruck’s small-business loan application process begins with five multiple choice prequalification questions that start on the Dealstruck homepage:
- How much do you need for your business?
- How soon do you need this loan?
- How long has your business been in operation?
- What is your credit score?
- What’s your average monthly revenue?
Then you’ll be asked to provide basic personal information. You’ll be prequalified if:
- Your business has been in operation for at least one year.
- Your personal credit score is at least 600.
- Your business averages at least $12,500 a month in revenue.
If you’re prequalified, you’ll see the screen below.
- What does your business do?
- How much money do you need to borrow?
- What will you do with the money?
- Do you serve other businesses, consumers or both?
- Do you have accounts receivable? What’s your current accounts receivable balance?
- Have you had any bankruptcies in the past two years?
- Is your business profitable?
- Do you have any existing loans?
After you speak with a Dealstruck loan specialist, the lender will follow up with an email about creating your Dealstruck account. You can also create an account before you answer the prequalification questions by clicking “Log in” in the top right corner of the homepage.
You’ll need to type in basic information about your business. You can search for your business through an embedded database, or enter the information manually.
If you choose manual, you’ll need to provide your business’s name, address, website and the number of employees you have. You’ll also have to choose your business’s legal structure and industry from a dropdown menu.
Finally, you’ll need to answer a few questions about your business’s financials: your annual revenue for the previous year, your average monthly revenue and your current average net profit per month.
You’ll also be asked to describe how you’ll use the loan money. Depending on the reasons you list, Dealstruck will recommend a term loan, a line of credit or both. For example, if you want to refinance existing high-interest debt like a merchant cash advance, Dealstruck typically suggests a term loan to pay off your balance and a line of credit for ongoing working capital, says Candace Klein, Dealstruck’s chief strategy officer.
After you enter this information, you’ll see estimates by loan product, including a range of loan amounts and interest rates. You won’t know the exact interest rate Dealstruck will offer until you complete the entire application.
(if you have your financial documents ready)
Once you’ve successfully created a Dealstruck account and have received an estimated offer, you’ll have to complete the full application. This section will take the longest because it involves uploading financial documents, which many business owners don’t have readily available.
First, you’ll fill out personal financial information about each person who owns at least 15% of the business. Every owner must personally guarantee the business loan, which means the owners will be personally responsible for paying off the loan if the business defaults. Each owner must disclose the monthly mortgage or rent he or she pays on a home, monthly income, amount of liquid assets and Social Security number.
Next, you’ll be asked to upload two years of business tax returns, interim financial statements and, if you have accounts receivable, aging reports. Interim financial statements are balance sheets and income statements from the last six months. Aging reports show how many invoices you have outstanding and when they’re expected to be repaid. If you use QuickBooks, you can connect your account, making it easier to upload documents. Dealstruck will soon also be able to sync with other accounting platforms, says Bill Bonnefil, vice president of product at Dealstruck.
Finally, you’ll have to provide three months of business bank statements, starting with the most recent month. You can upload them by manually attaching the documents, or if you use a large bank, you can provide them electronically.
Dealstruck looks at all of this information — financials, tax returns, bank statements and, if applicable, aging reports — to get a full picture of your business’s financial health and ability to repay a loan, Klein says.
Once you’ve uploaded all of your financial documents and bank statements, you’re finished with the verification section. At this point, Dealstruck will check your credit report, which will count as a hard inquiry and will slightly lower your credit score. You’ll also get a follow-up call from your Dealstruck loan specialist within five minutes of submitting the final application, Klein says.
At the end of the phone interview, the underwriter usually will give you a general yes or no, Klein says. But you’ll get an official Dealstruck small-business loan offer in an email, Klein says, typically within 24 hours. The offer will include the exact interest rate Dealstruck is offering, and you’ll be able to accept or decline it online.
After you accept the loan offer, you can get the funds in your bank account within 24 hours, Klein says. The entire process, from prequalification to funding, takes between 48 hours and two weeks, Klein says.
Dealstruck’s application process is generally quick and easy. Each of the three sections don’t take long to complete individually, as long as you’re prepared with all of your financial statements, tax returns and bank statements.
If you’re ready to get started, apply on Dealstruck’s secure website:
Find and compare small-business loans
To compare Dealstruck with other lenders, NerdWallet has created a comparison tool of the best small-business loans to meet your needs and goals. We gauged lender trustworthiness, market scope and user experience, among other factors, and arranged them by categories that include your revenue and how long you’ve been in business.
Teddy Nykiel is a staff writer at NerdWallet, a personal finance website. Email: teddy@nerdwallet.com. Twitter: @teddynykiel.
To get more information about funding options and compare them for your small business, visit NerdWallet’s small-business loans page. For free, personalized answers to questions about financing your business, visit the Small Business section of NerdWallet’s Ask an Advisor page.
Screenshots from Dealstruck.com; other images via iStock
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